Subsistence households residing in the remote areas are principally dependent upon the forest for meeting their daily needs. They have very limited access to commercial fuels and therefore tend to rely on forest fuelwood to serve as a source of energy. However, in the face of forest scarcity they substitute other bio-fuels like agricultural crop residue, dung and fuelwood from trees on private land for forest fuelwoood. Although some studies have tried to analyse these issues, not much research have been made till date on this area. This paper addresses the problems associated with fuelwood production and consumption in the rural areas of Purulia district of West Bengal. Household responses to forest scarcity are analysed by a non-separable household model focusing on the prospects of fuel substitution. Based on primary data from six villages located on the Ajodhya Hills of Purulia OLS technique and probit model are fitted for estimation. It is observed that instead of reducing fuelwood collection from the forest, households respond to the scarcity by increasing its consumption. Substitution of forest fuelwood is noted only when number of trees on private land increases although the result turns out to be insignificant. This indicates that there are hardly any alternatives to forest fuelwood in the rural areas especially when the forest resources are available for free to the inhabitants residing in the vicinity of the forests.